MUMBAI: Tulsi Tanti's Suzlon Energy is confronted by an unexpected headwind emanating from the board room of REpower Systems AG, the German maker of wind turbines it plans to acquire for Rs 5,700 crore.
The shareholders of REpower Systems AG have before them two competing bids from Areva SA and Suzlon Energy Ltd.
Bloomberg quoted the REpower board as saying that Areva would be a "fitting strategic partner", without endorsing the company's bid. The Pune-based Suzlon, however, is putting up a brave front. Unfazed by the opinion expressed by the REpower board, which is clearly tilted towards the French nuclear power major Areva, as it claims the French company's bid offers "continuity" while terming Suzlon's offer as merely "lucrative."
Speaking to DNA Money, Suzlon spokesperson Vivek Kher said: "Significantly, the REpower board has thus far refrained from making any definitive recommendations to its shareholders on the two competing offers."
Suzlon is confident that once the REpower board goes through the prospectus filed with the German capital markets regulator, the European wind turbine maker will be more comfortable to align with Suzlon.
Reports also suggest that Areva, owned by the government of France, has differences within the board on the takeover of REpower. The minister for economic affairs is not in favour of the bid, and has crossed swords over Areva CEO's bid to diversify his nuclear power-generating company into wind energy.
Suzlon's bid for the German wind turbine maker is 20% higher than Areva's bid and also has the support of Martifer, an institutional investor which controls 25% of REpower stocks.
Suzlon's bid of €126 per share is about 20% higher than France-based Areva's bid of €105, thus valuing REpower at $1.33 billion.
Suzlon is bidding through a subsidiary, which is 75% owned by itself and a 25% stake is held by Martifer SGPS, SA and Oliveira de Frades, Portugal.
REpower has a good presence in Europe, which has drawn Suzlon towards it to gain a sizeable market presence in Europe.


